Queues - coming to an Emergency Department near you

Friday 2 May 2014

Health Care costs in Australia are rising and are likely to continue doing so as our population both grows and ages. Which means attempts to address this issue are warranted. Equally warranted is an assessment of the impacts for addressing or ignoring the issue. If, as has been mooted, the Australian Government introduces an $8 or $15 fee to go and visit the GP, appears in the upcoming budget, what are some of the implications?

The implications for not acting on this is an increasing strain on Government budgets as costs for health begin to reduce the options Governments have for spending in other areas. If we were getting older and staying healthier, all would be fine. Alas we are not doing both - we are living longer and that increase in lifespan also leads to an increased need for medical attention, such as it is when people like the idea of staying alive.

Medical service costs are increasing, in no small part to increased costs of training doctors (as Universities have latched onto huge profit potential in Medical courses) as well as Insurance companies raising premiums for doctors. These premiums have been raised in response to consumers (us) being more willing to sue doctors for mistakes and the courts being more willing to enable larger payouts (though not yet of the US style exorbitancy levels). So we're all in this thing together - we want to live longer and stay as healthy as we can, we sue when something goes wrong, Universities use medical courses as income generators, Insurance companies need to cover costs and make profits and so on.

Which means that finding ways to offset expenditure is warranted.

If there's one thing we know about human behaviour it is that we can be price sensitive. Simply put, if we are hit with a new fee (or an increased one) for using a product or service, time and time again we see drop in use of that product or services. Case in point - increases in tobacco taxes result in higher prices results in less use of cigarettes results in better health outcomes results in less health costs overall.

Utilising this approach, the Australian Government will introduce a tax to see a General Practitioner. If there's one thing likely to happen, it is that this fee will see fewer people visiting their GP. Higher price = less people using the service = less costs. Except that is not what will happen. What we WILL see more likely to happen is this: $15 fee = less visits to the GP = more visits to Hospital Emergency Departments = increased waiting times for those who really need to see a doctor = poorer patient outcomes = increased health care costs.

Now I quite like user pays systems and I quite like it when Governments use financial disincentives to change negative social behaviours. Speeding, seat belts, drugs, cigarettes have all seen increased fines or increased taxes and by and large led to changes in social behaviour. But the GP fee will not work beneficially. Instead GP income will drop, health care costs will rise and patient outcomes for society will deteriorate.

In this case the financial penalty will create an INCENTIVE rather than a disincentive, but shift the costs into an area of the health sector that has a far largest cost for intervention (the hospital ED). A few years ago the Australian General Practise Network conducted research in diabetes management at the hospital end and the GP end of health services. It was about $1 to $9. A dollar of intervention at the GP end would cost about $9 if delivered through the hospital system. That bodes poorly for health costs and the future Australian Government budgets.

UNLESS, the unintentional INCENTIVE to use the ED was offset by a LARGER Disincentive at the ED end.

It would work as follows: If someone presents at an ED and is subsequently found NOT to be in need of an ED intervention, they would be hit with a $30 fee. Yes I know it sounds harsh and yet that is the ONLY way the $15 fee for a GP visit could end up lowering the costs - people will stay at home getting as sick as possible until daring to venture out to see a GP. By then of course the costs with getting them back to recovery may be even greater, but in the interim usage of GP services would be alleviated. I'm not saying that is fair or humane. I'm merely talking about how human behaviour works.

Financial disincentives work. Kind of like a carbon tax on pollution. But that's a different story

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